1 ) The Yacht club builds personal yachts. Its annual demand is 10 yachts. This company can build at a rate of one yacht per month. Carrying cost is very expensive and is about $10,000 per year. The setup cost for a production run of yachts is $2,000. Find the order quantity and I(max).

2) Apple cakes reviews inventory every two weeks with lead time of seven days demand rate 40 units per day and standard deviation five units per day. If the company tolerates no more than one stock-out per year, develop the ordering policy for a fixed time period inventory system assuming 52 weeks per year.